Are foreclosures dragging home prices down? According to most economist the answer is a definitive YES. Economist, Mark Zandi predicts, with growing unemployment, home prices will likely continue to fall another 10% in the next 12 months. By his estimates another 2 million homes will be in foreclosure in 2011.

Currently about 2 million single family homes are in foreclosure or REO.  Talk about transfer of wealth. The El Paso - Fort Bliss area has not been exempt from the foreclosure story. But not because of unemployment as Zandi predicts will continue to contribute to the increase of bank-owned properties. No, it was predatory lending practices that prevailed during the 2005 - 2006 housing boom. Making homes affordable for people with poor credit or transitory employment was a huge mistake for El Paso. Unfortunately, the one left holding the bag was the home owner.  The silver lining, if you can call it that, is that for the first time since labor records have been recorded, El Paso's unemployment rate is lagging behind the national rate of 10.2%.  Read more...